PERSONALIZED WEB SITES VS CONSUMERS' PRIVACY

Consumer expectations for superior online customer service are driving many businesses to consider ways to individualize an otherwise generic Web page, according to Cahners In-Stat Group. The high-tech market research firm finds that the one way that firms are trying to accomplish this is through personalization - technologies that enable businesses to tailor content for end users and present them with a unique online interaction. A recent In-Stat survey of nearly 900 executives found that, while the idea of personalization for business interactions was viewed favorably, overall adoption of these technologies has been low. "Personalization technologies offer a means for businesses to make online interactions more meaningful and effective," says Kirsten Cloninger, Industry Analyst with In-Stat's eBusiness Group. "However, businesses are still wary of infringing on consumers' privacy rights so adoption has been modest in the corporate market."

Firms are still focused primarily on customers for personalization, but are beginning to apply these technologies to employees as well. In-Stat anticipates that suppliers and partners will be future targets for these technologies primarily in the corporate market (100+ employees), as businesses continue to leverage the Internet for supply chain management, collaboration and communication. However, personalizing interactions for suppliers and partners is not likely to happen says Cloninger, "since many corporate businesses already have existing business processes and legacy systems, such as ERP or MRP solutions to manage communications, there is less urgency to implement these technologies."

In-Stat also surveyed small companies (1-99 employees) to determine personalization usage and perceptions. Although many small company Websites lack sophistication, even one- person businesses demonstrated an interest in ways to present consumers with more personalized online interactions. "For smaller companies, the use of personalization technologies is still a thing of the future," Cloninger says. "Until these company's Websites become more complex, only simple forms of personalization will make any sense for these firms." In-Stat also determined that online self-service continues to be a strong interest for small companies and a feasible means for them to augment the quality of online customer interactions.

In-Stat has also found that:

• The number of corporate market businesses (100+ employees) that are planning to use personalization technology will almost double by 2002, up from 22% to 43%. In the small companies market, 9% of small Internet-accessing companies reported that they currently use personalization technologies.
• Almost two-thirds of middle market and 80% of enterprise respondents indicated that preference-based personalization was not an invasion of privacy when used for business reasons.
• Customers constitute the number one online access priority for both the small companies and corporate markets, 58% and 56% respectively.

The reports, "User-interface Evolution: End-user Perceptions of Personalization & Privacy in the Small Companies", (#EC0103EV) and "User-interface Evolution: End- user Perceptions of Personalization & Privacy in the Corporate Market", (#EC0104EV) contain research collected from a Web-based survey of a panel of small, SOHO, middle and enterprise businesses. The survey examines the current perceptions and adoption of personalization technologies, as well as privacy concerns within these segments. To purchase this report, or for more information, please visit www.instat.com/catalog/cat-ec.htm or contact Chris Kissel at 480-609-4531; ckissel@instat.com. The reports are priced at $1,995 USD.

Cahners In-Stat Group, www.instat.com, covers the full spectrum of digital communications research from vendor to end-user, providing the analysis and perspective that allows technology vendors and service providers worldwide to make more informed business decisions.

In-Stat is a unit of Cahners Business Information, www.cahners.com, a leading provider of critical information and marketing solutions to business professionals and a member of the Reed Elsevier plc group.

Contact Kirsten Cloninger, Industry Analyst ­ eBusiness: User-Interface Service, kcloninger@cahners.com, 617-558-4942.